How much does rent stabilization save us and how much more is the replacement rent if we have to move?

Short answer: 5% to 80% of current rent for a typical resident, depending on how long they’ve lived in their apartment

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This article asks two questions with the same answer. The first question is, “How much does rent stabilization save us?” For West Hollywood residents, rent stabilization helps us stay in our homes by limiting annual rent increases (but not move-in rents). Over the years, the maximum allowable increases have ranged from 0% to 4%. It’s particularly helpful when market-rate rents are rising rapidly, as they are now (see our article How much have West Hollywood market-rate rents gone up?).

The second question is “How much more is the replacement rent if we have to move?” We might need to move, for example, because of family changes, because the owner is going to move in, or because we’ve been “Ellissed” out for real estate development. When we move, we leave behind the below-market rent we built up as long-term tenants.

The answer to these two questions depends on many factors. This article offers estimates for hypothetical residents in different situations. You can try out your own scenarios with our replacement rent calculator.

The chart below shows the replacement rent for one hypothetical family. They live in a rent-stabilized two-bedroom apartment. It’s in an older building, since the current rent stabilization ordinance doesn’t cover units built after 1979. They first rented the unit for about $1,400 in 2001. The landlord raised the rent each year by the maximum amount allowed. They paid about $1,800 a month in 2015.

Notes: Original rent was assumed to be the average move-in rent for 2001. Current rent was assumed to be the original rent plus maximum allowable rent increases through 2015. Move-in rent for 2015 was assumed to be the average for 2014 plus the same percentage increase as 2013 to 2014. Move-in rent for a newer building was assumed to be the average reported on Zumper.com for the beginning of January, 2016. Sources: West Hollywood annual housing reports; Zumper.com accessed February, 2016; our analysis.

If they moved now to a similar unit, their rent would increase by a third. That extra $600 per month is the savings they get from rent stabilization. It’s also the potential cost for them if they have to move. They could instead move to one of the city’s newer market-rate buildings. The increase might be over $1,500, nearly doubling their rent.

Replacement rent by apartment size

Our savings from rent stabilization — or the extra rent if we have to move — depend in part on unit size. The chart below shows estimates for hypothetical residents in average rent-stabilized units. It assumes they’ve been in their apartments since 2001.

The estimated replacement rents are 34% to 50% higher than their current rents. That’s how much rent stabilization saves them today.

Notes and sources: Same as above. Missing historical rents for three-bedroom units were filled in by taking older values and assuming the same percentage increases as two-bedroom units.

Replacement rent by years in apartment

The savings from rent stabilization also depend on how long we’ve lived in our apartments. This is illustrated in the following chart for hypothetical tenants who have lived in two-bedroom apartments from 1 to 14 years or 20+ years. The estimated replacement rents are 5% to 82% higher than their current rents.

Notes: Current rent for pre-1996 tenants was assumed to be the 2014 average reported by the City plus the maximum allowable increase for 2015. Current rent for other move-in years was assumed to be the original rent plus maximum allowable increases through 2015. The original rent was assumed to be the average move-in rent for that year reported by the City. Move-in rent for 2015 was assumed to be the City-reported average for 2014 plus the same percentage increase as 2013 to 2014. Sources: West Hollywood annual housing reports; our analysis.

Possible ways to reduce the replacement rent

For some residents who have to move out of their rent-stabilized apartments, there may be ways to reduce the financial impact. For example:

Subsidized/inclusionary housing: The City of West Hollywood has resources for eligible residents looking for affordable housing.

Downsizing: Getting an apartment with fewer bedrooms — if practical — may offset the loss of below-market rent for residents in two-bedroom units and for those in one-bedroom units for less than 10 years.

Relocating: For some, it may be necessary to leave West Hollywood to get an affordable replacement rent.

Short answer: 5% to 80% of current rent for a typical resident, depending on how long they've lived in their apartment|
This article asks two questions with the same answer. The first question is, 'How much does rent stabilization save us?' For West Hollywood residents, rent stabilization helps us...

DavidWarrendavid_warren@post.harvard.eduAdministratorWeHo by the Numbers

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reports using data to explore city government policy, performance, and community issues. Focused on West Hollywood (WeHo), Beverly Hills, Culver City, Los Angeles, and Santa Monica. Researched and written by David Warren as a private citizen. This is not a government website.